1999 Montana Legislature

A BILL FOR AN ACT ENTITLED: "AN ACT ESTABLISHING AN AGRICULTURAL ASSISTANCE AND
COUNSELING PROGRAM TO AID FINANCIALLY DISTRESSED FARMERS; PROVIDING FOR A TOLL-FREE
FARM CRISIS HOTLINE, FARM FINANCIAL CONSULTING, SUPPORT COUNSELING, INFORMATION AND
REFERRAL SERVICES, AND VOLUNTARY DEBT MEDIATION; AUTHORIZING THE DEPARTMENT OF
AGRICULTURE TO ADMINISTER THE PROGRAM; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND
A TERMINATION DATE."

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

NEW SECTION.Section 1. Purpose. It is the purpose of [sections 1 through 12] to establish an emergency program to
directly assist individual farmers who are financially distressed by providing them assistance and counseling to manage
farm credit problems, to avoid or mitigate forced liquidation or farm foreclosure, and to cope with the financial stress
resulting from the adverse conditions of agricultural production in this state.

NEW SECTION.Section 2. Definitions. As used in [sections 1 through 12], unless the context clearly indicates
otherwise, the following definitions apply:

(1) "Agricultural production" means the production of livestock, poultry, field crops, fruit, or other animal or vegetable
matter for food or fiber.

(2) "Department" means the department of agriculture provided for in 2-15-3001.

(3) "Farmer" means a person who owns or operates a farm or ranch primarily for the purpose of agricultural production.

(4) "Peer counselor" means a person who is or has been involved in agricultural production, who has been trained
through the department and others in financial counseling, and who works to aid financially distressed farmers through the
program.

(5) "Program" means the program established in [section 3].

NEW SECTION.Section 3. Establishment of program. (1) The department shall establish a program to aid
financially distressed farmers in this state.

(2) Under the program, the department shall make available to farmers the following types of assistance:

(a) farm financial consulting;

(b) support counseling; and

(c) information and referral services.

NEW SECTION.Section 4. Powers and duties of department. (1) For the purposes of administering the program,
the department shall:

(ii) the cooperative extension service and the college of agriculture at Montana state university;

(iii) state or federal agencies;

(iv) community service organizations;

(v) private business;

(vi) professional organizations;

(vii) regional mental health corporations;

(viii) volunteer organizations; and

(ix) any other person or entity capable of providing assistance to farmers;

(b) contract for services with qualified personnel, including peer counselors and farm financial consultants, to provide
the assistance required under [section 3];

(c) hire a coordinator and necessary staff to implement and manage the program;

(d) provide training for interested and qualified persons, including peer counselors, to assist farmers needing help with
farm financial management problems; and

(e) establish a toll-free telephone line to receive requests for assistance, counseling, and referral of services.

(2) The department may establish an advisory board to assist the department in determining policy and in developing
plans for administration of the program.

(3) The department may adopt rules necessary for the administration of the program. Rules must address but are not
limited to:

(a) the administration of services by entities enumerated in

subsection (1)(a);

(b) training requirements for peer counselors and qualified persons who work in the program;

(c) contract requirements applicable to entities that provide services under the program; and

(d) operation of the advisory board established in subsection (2).

NEW SECTION.Section 5. Gifts and grants to support program. (1) The department may accept monetary or
in-kind contributions, gifts, and grants provided to support the program.

(2) The department may receive grants on a matching formula basis to be used in accordance with the terms and
conditions for receipt of those grants.

NEW SECTION.Section 6. Voluntary mediation -- filing procedure -- dismissal of requests. (1) A farmer who is
in danger of foreclosure on agricultural property or a secured creditor may request mediation of the farmer's indebtedness
by filing a request with the department on a form prescribed by the department.

(2) In filing or responding to a mediation request, the farmer shall provide:

(a) the name and address of each secured and unsecured creditor;

(b) the amount owed to each creditor;

(c) the amount of the periodic installment payments due each creditor;

(d) any financial statements and cash flow statements, including those related to any nonfarm activities; and

(e) any additional information the department may require.

(3) In filing and responding to a mediation request, a secured creditor shall provide:

(d) the name and title of the representative of the creditor authorized to enter into a binding mediation agreement; and

(e) any additional information the department may require.

(4) A farmer or secured creditor who agrees to participate in mediation shall authorize the release to the department of
any information held by a creditor.

(5) Upon receipt of a properly completed mediation request form, the department shall direct a mediator to meet with
the farmer and secured creditor to assist in mediation. An unsecured creditor may participate in mediation between a farmer
and secured creditor if each party agrees or if the mediator determines that an unsecured creditor is a necessary party to the
mediation.

(6) Subject to the provisions in subsection (7), the department shall immediately terminate an attempt at mediation and
dismiss the mediation request if at any time the department finds that:

(a) a secured creditor does not agree to participate in mediation requested by a farmer; or

(b) the farmer does not agree to participate in mediation requested by a secured creditor.

(7) If the mediation request involves more than one secured creditor and any one creditor does not agree to participate in
mediation, the department shall dismiss the mediation request only insofar as it relates to that creditor.

NEW SECTION.Section 7. Duties and requirements of mediators. (1) A mediator must be qualified to provide
services required under the program. A mediator must be an impartial person knowledgeable in agricultural and financial
matters.

(2) In carrying out properly authorized duties, a mediator shall:

(a) listen to the farmer and any creditor desiring to be heard;

(b) attempt to negotiate an agreement that:

(i) extends the term of credit;

(ii) reduces the dollar amount of payments under credit; or

(iii) permits the farmer to continue in agricultural production and provides reasonable security to the creditor; and

(c) advise, counsel, and assist the farmer and creditor in attempting to arrive at a satisfactory agreement.

(3) A mediator may attempt to:

(a) arrange mutually agreed upon forbearance from litigation, rescheduled or renegotiated debt, voluntary sale, or other
liquidation of any agricultural property; and

(b) obtain assistance from any public or private agency.

NEW SECTION.Section 8. Mediation agreement. (1) If an agreement is reached between the farmer and a creditor,
the mediator shall draft a written mediation agreement to be signed by the farmer and the creditor.

(2) A farmer and any creditor who are parties to a mediation agreement:

(a) are bound by the terms of the agreement;

(b) may enforce the mediation agreement as a legal contract; and

(c) may use the mediation agreement as a defense against an action contrary to the mediation agreement.

NEW SECTION.Section 9. Unsuccessful mediation. If a mediation agreement cannot be reached, the mediator shall
recommend to the department that the mediation be concluded and the mediation request be dismissed.

NEW SECTION.Section 10. Confidentiality of records. (1) All materials, data, and information received by the
department with respect to any request filed under [section 6] are confidential and are not subject to examination or
disclosure as public information.

(2) An official, employee, or agent of the department may not knowingly disclose any materials, data, or information
concerning a mediation request without the consent of the farmer and the creditor.

NEW SECTION.Section 11. Closed meetings. Meetings between a farmer and any creditor conducted by a mediator
are not open to public participation and are not subject to the provisions of the open meeting law contained in 2-3-203.

NEW SECTION.Section 12. Waiver of liability. All parties who voluntarily enter into the mediation process as
described in [sections 1 through 12] shall waive their right to take civil action against the state of Montana and its
designated mediator and release the state and its designated mediator from civil liability for actions occurring within the
scope of the mediation services.

NEW SECTION.Section 13. Severability. If a part of [this act] is invalid, all valid parts that are severable from the
invalid part remain in effect. If a part of [this act] is invalid in one or more of its applications, the part remains in effect in
all valid applications that are severable from the invalid applications.

NEW SECTION.Section 14. Codification instruction. [Sections 1 through 12] are intended to be codified as an
integral part of Title 80, and the provisions of Title 80 apply to [sections 1 through 12].

NEW SECTION.Section 15. Effective date. [This act] is effective on passage and approval.